Natural justice in FEMA adjudication requires a fresh opinion after disclosure of withheld documents and a new explanation.

Withholding relied upon documents before the opinion stage under Rule 4 of the FEMA Adjudication Proceedings and Appeal Rules, 2000 violated natural justice. After the appellant was supplied the four documents and permitted to file a fresh explanation, the adjudicating authority had to reconsider the matter on the complete material and could not remain guided by the earlier view already formed. The earlier opinion was treated as non est for the fresh exercise, and a fresh opinion had to be formed solely on the appellant's explanation after full disclosure of documents.

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Issues: Whether, after the appellant was supplied the withheld documents and was given an opportunity to file a fresh explanation, the earlier opinion already formed by the adjudicating authority could continue to operate, or whether a fresh opinion had to be formed uninfluenced by the earlier opinion.

Analysis: The proceedings had reached the stage of opinion under Rule 4 of the Foreign Exchange Management (Adjudication Proceedings and Appeal) Rules, 2000, but four relied upon documents had not been supplied to the appellant. The denial of those documents amounted to a violation of natural justice. Once the appellant was directed to be given an opportunity to explain after receipt of all the documents, any further consideration had to proceed on that complete explanation and the full material, without being guided by the earlier view already recorded. The earlier opinion, therefore, could not survive the fresh adjudication exercise.

Conclusion: The adjudicating authority must form a fresh opinion on the appellant's explanation after supply of the four documents, and such opinion shall be uninfluenced by the earlier opinion, which is non est.

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